Investors abandoned blue chips and other large-cap stocks yesterday as a lower-than-expected consumer-confidence report fed into Wall Street's...
NEW YORK — Investors abandoned blue chips and other large-cap stocks yesterday as a lower-than-expected consumer-confidence report fed into Wall Street’s fears of an economic slowdown. The selloff overshadowed a technology-sector rally prompted by robust earnings from Dell.
The Dow Jones industrial average fell 49.36, or 0.48 percent, to 10,140.12. The Dow had fallen more than 100 points in afternoon trading before rallying at the close.
Microsoft, one of the 30 Dow stocks, gained 30 cents to close at $25.30 a share. Boeing, also a Dow stock, lost 99 cents to close at $59.50.
Broader indicators were mixed. The Standard & Poor’s 500 index was down 5.31, or 0.46 percent, at 1,154.05, while the tech-focused Nasdaq composite index gained 12.90, or 0.66 percent, to 1,976.80.
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The Dow Jones industrials ended the week down 205.28, or 1.98 percent, finishing at 10,140.12. The S&P 500 index lost 17.30, or 1.48 percent, to close at 1,154.05. The Nasdaq rose 9.45, or 0.48 percent, during the week, closing yesterday at 1,976.80.
Energy and utility stocks bore the brunt of the selling, as the week’s sharp decline in oil prices led investors to shift their assets out of these sectors — which had led the market’s gainers for much of the year. Treasury bonds benefited as investors sought less risk, and a few investors still took a chance on the tech sector, which saw a boost from Dell’s strong earnings.
Blue chips and other stocks were also held back by the University of Michigan’s consumer-sentiment index that showed a larger-than-expected drop in confidence. The May index came in at 85.3, substantially lower than the 88.3 Wall Street had expected.
“The consumer numbers out there were very frightening,” said Chris Johnson, manager of quantitative analysis at Schaeffer’s Investment Research in Cincinnati. “The consumer is in the driver’s seat in this economy, and a lot of big names depend on healthy consumer spending.”
Wall Street’s nervousness was apparent in the Treasury bond market, where investors were turning to safer Treasurys amid lingering concerns following the downgrade of big automakers’ debt.
The yield on the 10-year Treasury note fell to 4.13 percent from 4.17 percent late Thursday — the lowest yields since mid-February. The dollar made strong gains against most major currencies, especially the euro, which fell to a seven-month low against the dollar.
After falling substantially most of the week, oil prices pushed modestly higher in late trading, with a barrel of light crude settling at $48.67, up 13 cents, on the New York Mercantile Exchange.
Erroneous bids reported on Nasdaq
Erroneous bids for lightly traded stocks on the Nasdaq Stock Market were reported early in yesterday’s trading session.
Orders executed against those bids — some as high as $950 a share for a stock trading in the $4 range — were broken and removed from the tape, with the sellers getting their stock back and buyers reimbursed, the Nasdaq said. The incident will be investigated.